2014 (5) TMI 123 - AT - Customs

Refund of SAD sale as such - Notification No.102/2007-Cus, dt.14.09.2007 Import of coils - sale as Proflex Roof material - Revenue argued that no sales tax is paid at the time of clearance of the goods and sales tax is paid only as deemed sales at the time of raising final bill when the work of installation of roof is complete. Held That - quantity of imported goods used or sold is not known till the completion of the contracted work (Roof). In the final invoices also, it is not separately shown as to how much quantity of imported goods have been sold to the clients. Unused quantity of material/wastage also remains the property of the appellant. The rate of laying of Proflex Roof is also charged on per square meter including the value of the materials. Final retail invoice is issued after completion of work when the imported goods are not at all existing in the form they were imported - When the deemed sale of the material takes place, the imported goods do not exist as such but what exists is the Proflex Roof - It is also not made clear whether CST paid in the final invoices is only with respect to imported goods only or also represent other materials/consumables as per purchase orders - The facts of the present case are different from the facts of the case before Hon ble Gujarat High Court in the case of CC Vs Posco India Delhi Steel Processing Centre P. Ltd. 2013 (6) TMI 347 - GUJARAT HIGH COURT and accordingly, the relied upon case law is not applicable to the present appeals - Appeals filed by the appellant are rejected Decided against assesse.

Summary

Issues:
1. Refund claims rejection under Notification No.102/2007-Cus.
2. Eligibility for refund of Special Additional Duty (SAD) paid at the time of import under Section 3(5) of Customs Tariff Act, 1975.

Issue 1: Refund claims rejection under Notification No.102/2007-Cus:
The appellant filed appeals against the rejection of four refund claims under OIA No.298-301/2011/Cus/Commr(A)/AHD. The adjudicating authority upheld the rejection stating that the imported goods were not sold as such, making the appellant ineligible for a refund under Notification No.102/2007-Cus, dt.14.09.2007.

Issue 2: Eligibility for refund of Special Additional Duty (SAD) paid at the time of import:
The main issue in the appeals was whether the appellant was entitled to a refund of SAD paid at the time of import under Section 3(5) of Customs Tariff Act, 1975 as per Notification No.102/2007-Cus, dt.14.09.2007. The conditions for refund specified in the notification required the importer to pay all duties, indicate no credit of additional duty in the invoice, file a refund claim, pay appropriate sales tax, and provide necessary documents.

The appellant argued that the imported coils were removed as such, citing contracts and retail invoices to show VAT/CST payment on raw material clearance. They relied on case laws supporting refund eligibility. The Revenue contended that sales tax was paid only as 'deemed sales' upon completing the installation work, supporting the first appellate authority's decision.

The Tribunal analyzed the case records and relevant notification clauses. It noted that the importer must pay appropriate sales tax on subsequent sales as per the notification. The appellant referenced a Gujarat High Court judgment to argue that certain processes before sales do not disqualify a refund claim. However, the Tribunal found that the facts of the present case differed from the cited case law, as the imported goods were not separately identified in the final invoices after the completion of work.

Ultimately, the Tribunal rejected the appeals, emphasizing that the imported goods were not sold as such based on the working arrangement and final invoices, where the quantity of imported goods sold was unclear. The Tribunal distinguished the present case from the cited case law, leading to the rejection of the appeals.

This detailed analysis of the judgment addresses the issues of refund claims rejection under Notification No.102/2007-Cus and the eligibility for a refund of Special Additional Duty paid at the time of import under the Customs Tariff Act.